AP Private | July – August 2022

The topic of the day is the metaverse, in particular its incorporation in the financial sector. Its market is expected to exceed one trillion dollars over the next 3 years, with big techs’ investments acting as multipliers.

There is a good chance that Microsoft might incorporate its metaverse, Vortext, to the Teams platform, with a feature called Mash. This would allow its users to attend meetings through their avatars.

Different strategies: Facebook declared that Meta is conceived as a virtual environment in which people will have a chance to socialize, work and play; instead, Microsoft announced that Vortext is going to be rooted in reality.

People born between 1980 and 2005 can be easily imagined using the metaverse as a natural space to shop, interact by relocating one’s digital identity on various platforms and attend any kind of meeting.

However, in Italy wealth in still firmly in the hands of people whose children are currently in their twenty to forty. So, it is important to identify the main challenges and opportunities that will arise in the banking sector in the near future. The result would be defending market shares and attracting new generations.

The average age of private and HNW clients in Italy is seventy years old and shows no signs of decreasing. Over 60% among the most affluent people owe their wealth to a family business which has, on average, reached the fourth generation.

A survey conducted by FINER Finance Explorer for Advisor revealed (unsurprisingly!) that private and HNW clients together with their private bankers tend to feel more tepid than affluent clients towards the metaverse.

In fact, 15% of private and HNW clients see the metaverse as one of the megatrends with the highest growth potential as compared to 21% of affluent clients.

Therefore, it is easy to imagine that mass market clients would appreciate the metaverse more than private clients, who see it as more assimilated and less exclusive.

In truth, the writer Neal Stephenson was the first to prefigure the metaverse in 1992, introducing the term in his science fiction novel Snow Crash.

Curiously enough, Stephenson imagines a virtual environment populated mainly by the middle and upper classes.

In Stephenson’s novel, the differences between social classes are represented through the quality and resolution of the avatars (the black and white avatars of public terminals, or the 3D avatars of the most affluent individuals) and by the possibility to access exclusive locations.

As for banks and networks of financial advisors, the success of the incorporation of the metaverse in the relationship with clients will depend on their ability to guarantee an exciting experience for current clients and to predict and meet the expectations of future clients.

Banks and financial networks need to incorporate the metaverse at the right time. By doing do, they will implement the experience of clients through virtual worlds and augmented reality, whereby to offer financial consultancy within exclusive, yet virtual, spaces.

This would enable banks and financial networks to gain the loyalty of old clients and to attract their offspring and heirs, thus reducing the risk connected to the generational shift, when 50% of the members to the new generations change banker or bank.

So, welcome to the metaverse, to its private version and for less than young clients.

Nicola Ronchetti